Limits on Drug Firm Incentives Opposed

Merck & Co., Johnson & Johnson, doctors and insurers are among those protesting proposed limits on drug makers’ use of discounts and cash incentives to encourage the use of their products.

The Department of Health and Human Services has suggested that routine incentives offered to persuade doctors and insurers to switch patients to their medicines or include them on lists of preferred drugs may violate federal kickback laws.

The agency proposed voluntary limits on such promotions in October.

The drug industry, insurers, pharmacists, biotechnology companies and wholesalers say the guidelines from the HHS inspector general’s office fail to distinguish between legal and illegal discounts and other promotions and may increase health-care spending and hurt patient care.

“The guidance provides little practical instruction on which practices the government believes should be changed or curtailed and which practices are viewed more favorably,” Patrick Davish, Merck’s senior director of public policy, wrote in a letter to Health and Human Services Inspector General Janet Rehnquist.

The HHS has said the drug industry promotional practices may drive up spending by Medicare and Medicaid, the government health insurance plans for the elderly, disabled and poor.

The American Assn. of Health Plans, whose members include Aetna Inc., Cigna Corp., PacifiCare Health Systems Inc. and WellPoint Health Networks Inc., said the rules “could have the unfortunate effect of increasing costs throughout the health- care system.”

The American Medical Assn. called some of the recommendations vague and asked for more details on whether drug companies would be allowed to help pay for doctors’ educational programs and conferences.

The inspector general’s office has collected about 142 letters on the proposed guidelines as part of the process of developing final rules on drug-maker incentives and promotions.